Clearly, the terms contribution margin and gross margin cannot be used interchangeably based on their names. As a result, the statement is false.
Contribution margin can be computed when we deduct the variable costs from the sales revenue.
Formula for Contribution Margin:
Sales Revenue - Variable Costs = Contribution Margin
or
Sales Revenue - (Variable Cost per Unit × Number of Units) = Contribution Margin
However, the gross margin can be calculated when the cost of goods sold are deducted from the sales revenue.
Formula for Gross Margin:
Sales Revenues - Cost of Goods Sold = Gross Margin
So, to put it simply, the contribution margin actually measures the profitability of different finished goods, while the gross profit margin merely measures the amount of income that is left over after deducting the expenses incurred related to the operations.
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. Which of the following is a true statement regarding a performance indicator? a. All healthcare organizations are required to report a performance indicator b. Only governmental health care organizations are required to report a performance indicator. c. The purpose of reporting a performance indicator is to make it easier to compare the result of operations of not-for-profit health care organizations to those of for-profit health care organizations d. The purpose of reporting a performance indicator is to assist in evaluating the efficiency and effectiveness of a health care organization’s operating activities.
Answer:
C. The purpose of reporting a performance indicator is to make it easier to compare the results of operations of not-for-profit health care organizations to those of for-profit health care organizations.
Explanation:
performance indicator which can as well be regarded as key performance indicator is reffered to type of performance measurement, which enables evaluation of the success of an organization as well as particular activities like projects, products and
programs, that the company engage in.
It should be noted that The purpose of reporting a performance indicator is to make it easier to compare the results of operations of not-for-profit health care organizations to those of for-profit health care organizations.
You plan to operate a basketball camp during the summer at Duke University. The total number of participants is 200. Camp participants will stay three nights in the university dormitories, and each room will house two camp participants. Duke charges you $40 per room each night. Liability insurance to run the camp will cost $3,000. Meals for the three day camp will cost $6,000. Duke will not charge you for the use of the basketball facility. Nike will provide sporting goods to be used by, and given to, participants. You and your partner each want to make $8,000 profit from running the camp. How much will you have to charge each participant to meet your goal?
Answer:
$245 per participant
Explanation:
total number of participants = 200
total costs for 200 participants:
$40 per night x 3 nights x 200 = $24,000 for rooms$3,000 for insurance$6,000 for mealstotal costs = $33,000
if you want to earn $16,000 in profits ($8,000 each),
price per participant = ($33,000 + $16,000) / 200 = $49,000 / 200 = $245
commercial banks hold deposits and
Use the Internet to research the Robinson-Patman Act and list 3 forms of discrimination this legislation prevents.
The Robinson-Patman Act, officially known as the Anti-Price Discrimination Act of 1936 and passed in the United States in 1936, forbids large franchised
The 3 forms of discrimination this legislation prevents are: pricing, promotional allowances, and advertising by large franchised companies.
What was Robinson-Patman Act?The Robinson-Patman Act image lists three types of discrimination that it forbids. An antitrust statute passed in the United States in 1936 called the Robinson-Patman Act (RPA) forbids large chains and franchises from discriminating against small firms on the basis of pricing.
A federal statute known as the Robinson-Patman Act was created in 1936 to safeguard small firms from unfair competition. It forbids big businesses from giving exclusive discounts to some clients that are not extended to all clients. Additionally, the legislation forbids businesses from using specific forms of price discrimination.
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The discrimination that Robinson-Patman Act legislation prevents includes on:
pricing,promotional allowances, advertising What was the Robinson-Patman Act?Robinson-Patman Act, also known as Anti-Price Discrimination Act, is a United States law enacted in 1936 that protects small businesses from being driven out of the market by prohibiting pricing, promotional allowances, and advertising discrimination by large franchised companies.
The Robinson-Patman Act also seeks to protect wholesalers from exclusion from the purchasing chain. Wholesalers are opposed to such franchises buying products directly from manufacturers. The Robinson-Patman Act is part of the Clayton Act of 1914's antitrust legislation.
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Imboden Manufacturing Company established the following standard price and cost data: Sales price $15 per unit
Variable manufacturing cost $7 per unit Fixed manufacturing cost $32,500 total Fixed selling and administrative cost $24,000 total Imboden planned to produce and sell 18,000 units.It actually produced and sold 19,000 units.
Required a. Prepare the pro forma income statement that would appear in a master budget. Use the contribution margin format
b. Prepare the pro forma income statement that would appear in a flexible budget. Use the contibution margin format
The pro forma income statements for Imboden Manufacturing Company, both in the master budget and flexible budget, show an operating income of $95,500.
a. Pro Forma Income Statement (Master Budget)
Sales Revenue: (19,000 units * $15 per unit) = $285,000
Variable Manufacturing Costs: (19,000 units * $7 per unit) = $133,000
Contribution Margin: $285,000 - $133,000 = $152,000
Fixed Manufacturing Costs: $32,500
Fixed Selling and Administrative Costs: $24,000
Total Fixed Costs: $32,500 + $24,000 = $56,500
Operating Income: $152,000 - $56,500 = $95,500
b. Pro Forma Income Statement (Flexible Budget)
Sales Revenue: (19,000 units * $15 per unit) = $285,000
Variable Manufacturing Costs: (19,000 units * $7 per unit) = $133,000
Contribution Margin: $285,000 - $133,000 = $152,000
Fixed Manufacturing Costs: $32,500
Fixed Selling and Administrative Costs: $24,000
Total Fixed Costs: $32,500 + $24,000 = $56,500
Operating Income: $152,000 - $56,500 = $95,500
Both the pro forma income statements in the master budget and flexible budget show the same operating income of $95,500.
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In 2015, the price of US butter imports increased by more than 100 percent compared to the previous year. At the same time, many of the major butter exporters to the US, including New Zealand, saw their share of butter imports drop, while Mexico saw its share rise. What do you think happened in the market to cause this change? How do you think price served as a signal and incentive to producers?
a.The primary factor behind the increase in butter prices was a lack of supply.
b. This is because increased butter prices imply that there is a shortage of supply in the market, leading to an opportunity for producers to maximize profits by increasing production to fill the gap in supply and demand.
In 2015, the price of US butter imports increased by over 100 percent compared to the previous year. During the same period, several significant butter exporters to the US, such as New Zealand, saw their share of butter imports decrease, while Mexico's share increased.The primary factor behind the increase in butter prices was a lack of supply. The major butter exporters were experiencing either climatic or political issues that affected their production, hence their export ability.
For example, New Zealand experienced droughts that severely impacted their dairy production, causing a sharp decrease in the supply of butter exports to the United States.Additionally, countries such as the Netherlands and Australia, which had previously supplied butter to the United States, chose to sell their supplies in Europe, where prices were much higher, due to the depreciation of the euro and a decrease in the supply of milk.Therefore, the drop in supply of butter imports from these countries led to an increase in the prices of butter imports in the United States.
The significant rise in butter prices served as an incentive to producers to increase their butter production to meet the growing market demand. Moreover, the increase in prices signaled the opportunity for increased competition in the market, as new entrants could enter the market, increase supply, and take advantage of the high butter prices to earn profits. As a result, the high price served as an incentive for producers to increase butter production, while signaling the opportunity for increased competition in the market.
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How do credit card companies make money?
O (A) Fees and interest paid by cardholders
O (B) Investing your credit card debt
O (C) Fees paid by merchants
O All of them
O A and B
O A and C
OB and C
Answer:
A and C
Explanation:
Credit card companies get their income form the following three main sources
Interest paid by cardholdersFees charged to cardholders' credit cards.transaction charges paid by merchants who accept credit cardsInterests form the bulk of income to the card companies. Typically charge interest arises when customers carry a balance from a month to the next. Fees charged include annual fees, late fees, cash advance fees, balance transaction fees, among others. Merchants usually pay a percentage for every transaction conducted via a credit card. The percentage ranges between 1% to 3 %.
Molly has a $2500 down payment saved for this purchase. Molly assumes the $1500 cash allowance will come straight off her total. How much loan does molly need?.
The Loan needed by Molly is $21,495
Based on the information given molly is going to pay the exact MSRP of $25,495 and Cash Allowance of $1,500
Now, let determine How much loan does Molly need:
Using this formula,
Loan needed =MSRP amount- Down Payment-Cash allowance
Where:
MSRP amount=$25,495
Down payment=$2,500
Cash allowance=$1,500
Let plug in the formula:
Loan needed=$25,495-$2,500-$1,500
Loan needed=$21,495
In conclusion, The Loan needed by Molly is $21,495.
What Is the Manufacturer's Suggested Retail Price (MSRP)?The price a product's manufacturer advises it to be sold for at the point of sale is called the manufacturer suggested retail price (MSRP). Some retailers also use the term "list price" to refer to the MSRP. An MSRP can be assigned to any retail item, even though they are most usually associated with cars. There is also an MSRP for other expensive items like electronics and appliances.
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Click to review the online content. Then answer the question(s) below, using complete sentences. Scroll down to view additional questions. Online Content: Site 1 Explain what is meant by "commercial sites" (site 1)
Answer:
Cultural Characteristics of Latin America
The term “Latin America” refers to all countries in South America. Latin America also includes parts of Central America, Mexico, and the Caribbean islands.
Latin America’s climate can be hot and humid or rainy, depending on the location and the season. Rainforests, deserts, and savanna are found throughout the region. The weather varies from area to area.
South of the equator, seasons are the opposite of ours. When the United States experiences summer, South American countries are in winter. Because of this, you might recognize another difference. In many South American countries like Brazil, the school year begins in early February. There is usually a two-week winter vacation in July. The second semester then begins and the school year ends after the holiday season, in January.
Brazil’s new constitution of 1988 included policies that support the country’s education system. Since then, the government’s Ministry of Education has been the force driving Brazil’s public school system.
Brazil’s constitution states that education is a right for all citizens. It explains that the goal of education is to fully develop students. This includes preparing them to be responsible citizens and future workers.
Brazil’s Education System
Education in Brazil has seen major improvements in recent years. It is one of the best systems in Latin America. However, in some poor areas, public schools still lack appropriate resources. In the poorest sections of Brazil, schoolrooms may not have air conditioning, forcing students to swelter in the heat. There is also a lack of books, computers, and teachers in these poorer areas. For the most part though, the quality of public education in Brazil is continually on the rise.
It is mandatory that all Brazilian children seven years of age and older attend school. Though this is the law, some families choose to keep children home, especially in rural areas where children often have to work to help support their families. The majority of children are attending school, though, even during their younger years. Children aged 3 to 5 can enter Educação Infantil, which is preschool. They are either enrolled in a daycare-type setting or an academic class, depending on what their families want.
Primary school begins around age 6 and continues to age 15. Students of various ages often sit next to each other in the same class. This is because children enter the school system at different ages. Many students are also often held back to repeat grades if they do not pass their year-end exams. For this and other reasons, many public schools in Brazil are overcrowded.
Some students may walk to school while others may take a bus or are driven by their parents. However they travel, their hours in the classroom may vary. When they arrive, they are often divided into different “sessions” during the day. Most students don’t attend school for an entire day. A student may attend a morning, afternoon, or evening school session. Each is usually broken up into a 5-hour period.
Portuguese is the official language of Brazil and is a major subject studied in primary school. History, geography, math, science, and physical education are also taught. Additionally, students may have foreign language classes such as English and Spanish. Many hope to continue their educations after they graduate. Some go on to pursue college degrees in other countries, like the United States, so learning English or Spanish in primary school is often necessary.
Explanation:
thats the passage
Answer:
Cultural Characteristics of Latin America
The term “Latin America” refers to all countries in South America. Latin America also includes parts of Central America, Mexico, and the Caribbean islands.
Latin America’s climate can be hot and humid or rainy, depending on the location and the season. Rainforests, deserts, and savanna are found throughout the region. The weather varies from area to area.
South of the equator, seasons are the opposite of ours. When the United States experiences summer, South American countries are in winter. Because of this, you might recognize another difference. In many South American countries like Brazil, the school year begins in early February. There is usually a two-week winter vacation in July. The second semester then begins and the school year ends after the holiday season, in January.
Brazil’s new constitution of 1988 included policies that support the country’s education system. Since then, the government’s Ministry of Education has been the force driving Brazil’s public school system.
Brazil’s constitution states that education is a right for all citizens. It explains that the goal of education is to fully develop students. This includes preparing them to be responsible citizens and future workers.
Brazil’s Education System
Education in Brazil has seen major improvements in recent years. It is one of the best systems in Latin America. However, in some poor areas, public schools still lack appropriate resources. In the poorest sections of Brazil, schoolrooms may not have air conditioning, forcing students to swelter in the heat. There is also a lack of books, computers, and teachers in these poorer areas. For the most part though, the quality of public education in Brazil is continually on the rise.
It is mandatory that all Brazilian children seven years of age and older attend school. Though this is the law, some families choose to keep children home, especially in rural areas where children often have to work to help support their families. The majority of children are attending school, though, even during their younger years. Children aged 3 to 5 can enter Educação Infantil, which is preschool. They are either enrolled in a daycare-type setting or an academic class, depending on what their families want.
Primary school begins around age 6 and continues to age 15. Students of various ages often sit next to each other in the same class. This is because children enter the school system at different ages. Many students are also often held back to repeat grades if they do not pass their year-end exams. For this and other reasons, many public schools in Brazil are overcrowded.
Some students may walk to school while others may take a bus or are driven by their parents. However they travel, their hours in the classroom may vary. When they arrive, they are often divided into different “sessions” during the day. Most students don’t attend school for an entire day. A student may attend a morning, afternoon, or evening school session. Each is usually broken up into a 5-hour period.
Portuguese is the official language of Brazil and is a major subject studied in primary school. History, geography, math, science, and physical education are also taught. Additionally, students may have foreign language classes such as English and Spanish. Many hope to continue their educations after they graduate. Some go on to pursue college degrees in other countries, like the United States, so learning English or Spanish in primary school is often necessary.
Explanation:
as a result of recent downsizing at his firm, emerson lost his job as an it manager for a large telecommunications company. a true, self-confirmed computer nerd, emerson knew that several of his past contacts often outsourced their computer problems. he decided it was a good time to test the waters and see if he could secure enough computer clients to be in business for himself. his success demonstrated that
Emerson was determined to make the most of his situation and took the opportunity of being laid off to pursue his lifelong passion of working with computers.
What is passion?Passion is an intense emotion that drives an individual to take action. It is a strong feeling of enthusiasm, desire, or excitement for something. Passion is an emotional state that can be directed towards any activity, person, cause, or ideal. It is often associated with a strong will to succeed, to overcome obstacles, and to reach a desired goal. Passion can influence a person's motivation, creativity, and confidence. It can propel them to strive for excellence, to take risks, and to challenge the status quo.
He sought out his contacts who often outsourced computer problems, and was able to secure enough clients to be in business for himself. His success demonstrated his commitment to his passion and his entrepreneurial spirit.
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As a salaried employee, Richard Hernandez earns $776 each week. In one week, he worked 50 hours. What is his gross pay for that week?
Answer:
He would get paid $38,800 he will get $38,800 because I multiplied $776 and the 50 hours and that's how I got $38,800.
suggest any 5 methods by which the condition of technical education can be improved
Answer:
Acknowledge and address overcrowding.
Make funding schools a priority.
Address the school-to-prison pipeline.
Raise standards for teachers.
Put classroom-running and curriculum-building decisions in the hands of the community.
Explanation:
Technology can be utilized to improve teaching and learning and help our students be successful. ... Through the use of learning management systems (LMS) students can access online resources to get assistance on demand beyond the physical reach of their teacher. Technology can also extend education in another way.
assisted projects aimed at improving technical and vocational education. Introduction ... priorities as defined by aid recipients (see, for example, Gray &.
Technical education is a term applied to schools, institutions, and educational programs that specialize in the skilled trades, applied sciences, modern technologies.
Mark Adler earned $1,963. 71 salary per month as an assistant technician at a recording studio. His new job pays $9. 80 per hour with time and a half for all hours over 40 hours per week. How many hours of overtime per week will he have to work to earn the same amount per week at his current job?
To earn the same amount per week at his current job, Mark Adler needs to make $1,963.71 / 4 = $490.93 per week.
Let's first calculate Mark's regular hourly rate at his new job:
$9.80 per hour x 40 hours = $392.00 per week
To earn the remaining amount he needs, Mark must work overtime at a rate of time and a half:
$490.93 - $392.00 = $98.93 per week
$98.93 / 1.5 = $65.95 per week
Mark needs to earn an additional $65.95 per week through overtime.
Since Mark's regular hourly rate is $9.80 per hour, his overtime rate would be $9.80 x 1.5 = $14.70 per hour.
Thus, Mark needs to work overtime for $65.95 / $14.70 per hour = 4.49 hours per week, which we can round up to 5 hours per week. Therefore, he needs to work 5 hours of overtime per week to earn the same amount at his new job as he did at his old job
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In practice, most companies list accounts on their trial balance in alphabetical order.a. Trueb. False
The trial balance does not contain an alphabetical listing of the accounts. In reality, they are ordered in the following order: Assets.
Describe assets.One of the words with a general meaning and a defined meaning is "asset." The asset is a word that is commonly used to describe someone who is a real asset to their community.
But what do finance professionals understand by assets in the context of commercial accounting?
An asset is anything of value that a business anticipates will be useful in the future. The main element of a company's net worth is its assets. When giving loans, lenders may also take into account a company's assets. This article solely discusses company-owned assets; it does not discuss right-of-use assets (i.e. leased assets).
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3-5 sentences on information about Economics.
Answer:
go online to do it it will be better
A machine was purchased for $500,000 with a residual value of $50,000. The company estimates that the machine will last 5 years and produce 2,000,000 parts over its life. Calculate depreciation expense using the Straight-Line method for the 5-year life. (NOTE: Round your answers to the nearest dollar and enter it enter it WITHOUT decimals, commas or dollar signs [Example 75000].)
This means that the company will record $90,000 as depreciation expense on the machine in each year of its useful life until it reaches the residual value of $50,000.
The Straight-Line method of depreciation allocates the cost of an asset evenly over its useful life. To calculate the depreciation expense for the machine over its 5-year life, we need to first determine the depreciable cost of the asset. The depreciable cost of the asset is the original cost minus the residual value. In this case, the depreciable cost would be $500,000 - $50,000 = $450,000.
Next, we divide the depreciable cost by the number of years of useful life to calculate the annual depreciation expense. So, the annual depreciation expense for this machine would be $450,000 / 5 years = $90,000. Therefore, the depreciation expense using the Straight-Line method for the 5-year life would be $90,000 per year. This means that the company will record $90,000 as depreciation expense on the machine in each year of its useful life until it reaches the residual value of $50,000.
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_____ was withheld specifically for the tax that is used to pay for a healthcare program.
_____ was withheld for the payroll tax that specifically supports retired and disabled citizens.
_____ If this individual made more money, the amount withheld for Social Security would
Answer: First : 612.65$
second : 2567.45$
Third : Increase
Explanation: i did this by self its surity
Answer:
Answers
First Sentence: $612.65
Second Sentence: $2567.45
Third Sentence: Increase
Explanation:
Edgen 2020
You scheduled a meeting with your banker to discuss your findings. How will you fine-tune your product to incorporate your market research?
Answer:
5 Simple Steps to Fine-Tune Your Digital Marketing Planwww.convinceandconvert.com › digital-marketing › fi...
Were results good, targets met, and goals achieved? Or did your plan totally miss the mark? If you don't review what you did, how will you know what worked
Explanation:
What is an accurate definition of experience?
the collection of things a person has done
a natural ability a person is born with
a subject a person would like to learn more about
the factors that have influenced a person throughout life
Answer: A)the collection of things a person has done
Explanation: just answered it EDGE 2021
Answer:
A on edge
Explanation:
Caleb will be going to college next year. He would like to save some money for living expenses. Select the goal that would be the most helpful for him.
Answer:
save 100$ each check.
Explanation:
goods are the products businesses use to produce other goods.
Next
Answer:
so whats your question
Explanation:
Tina works a cash register and has to hold her arm at a certain angle to scan her customers' items. What is the ergonomic hazard in this situation?
Select the best option.
Awkward posture
Incorrect tool usage
Relaxed arms and shoulders
Repetitive moveme
Answer:
repetitive movement
Explanation:
i actually had this question in my last period that's so fun hahha good luck
The ergonomic hazard in this situation given above is:
A. Awkward postureAccording to the given scenario, a cashier has to hold her hand in a certain manner in order to properly scan the items of the customers who came to make purchases at the store.
As a result of this, we can see that the ergonomic hazard which is described from the above scenario is that of an awkward posture which Tina, the cashier has to perform.
Therefore, the correct answer is option A
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what is a perfect market?
Answer:
A Perfect market is
a market where the sellers of a product or service are free to compete fairly, and sellers and buyers have complete information: The internet has a big part to play in the creation of a perfect market. Compare. imperfect market.
The data show the
number of railroad crossing accidents for the 50 states
of the United States for a specific year. Construct a
histogram, frequency polygon, and ogive for the data.
Comment on the skewness of the distribution. (The data
in this exercise will be used for Exercise 14 in this
section.)
Class limits Frequency
1–43 24
44–86 17
87–129 3
130–172 4
173–215 1
216–258 0
259–301 0
302–344 1
Answer:
I hope this helps
Explanation:
216-258 0
Evidence from the market for eyeglasses suggests that advertising leads to:
a) lower quality products for consumers
b) lower prices for consumers
c) higher prices for consumers
d) less concern on the part of consumers about price differences among similar goods
Evidence from the market for eyeglasses suggests that advertising leads to higher prices for consumers (option c). Advertising plays a significant role in increasing brand awareness and shaping consumer preferences. However, it also adds to the overall cost of the product, as companies need to invest resources in marketing efforts.
When eyeglass manufacturers spend on advertising, they tend to pass those expenses onto the consumer in the form of higher prices. The purpose of advertising is often to differentiate products and create a perception of value, leading consumers to choose a particular brand over another. This can result in consumers paying a premium for branded eyeglasses as opposed to similar, less expensive alternatives.
In summary, advertising in the eyeglasses market generally leads to higher prices for consumers due to the added costs of marketing campaigns and the perceived value associated with branded products.
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Explain at least four costumer rights.
Answer: The right to safety, the right to be informed, the right to choose and the right to be heard.
Explanation:
There is a growing movement in the United States led by the progressive wing of the Democratic Party to have the federal minimum wage raised to $15/hr. Some people agree with the $15/hr minimum wage for the United States, while others oppose raising the minimum wage. The arguments against raising the minimum wage range from the government should not dictate salaries to it will cause low wage workers to lose their jobs since businesses cannot afford a $15/hr minimum wage.
Do you agree with a $15/hr federal minimum wage? The current federal minimum wage in the United States is $7.25/hr. Fully explain your position on this issue in 2 - 3 paragraphs.
Source: Surviving an Unlivable Wage l Full Documentary (Financial Literacy)
In my opinion, minimum wage should be increased because an increase in minimum wage would reduce poverty, increase consumer spending, and promote economic growth.
Why Should Minimum Wage be Increased?Minimum wage has not kept pace with inflation, and that the current federal minimum wage of $7.25/hr is not a living wage in most parts of the United States. A $15/hr minimum wage would provide a more realistic living wage for many low-wage workers, but there is disagreement on whether this should be achieved through federal legislation or through individual state action.
Ultimately, whether or not to raise the minimum wage is a complex issue that involves balancing the needs of workers, businesses, and the overall economy. It is important for policymakers to carefully consider the potential impacts of any minimum wage increase and to find ways to support low-wage workers without unduly burdening businesses.
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In 2020, Amanda set up Coverdell education savings accounts for each of her four grandchildren, aged 7, 9, 14, and 16. She would like to contribute the annual maximum to each savings account when she usually makes other annual-election gifts every year on December 31. The annual maximum for 2020 is $2,000. How much can she contribute in total to the Coverdell education savings accounts in 2020 and each of the next four years
Answer:
The answer is "$32,000"
Explanation:
Coverdell mutual funds must be paid until the beneficiaries are 18 years old. The 16-year-old would be only eligible for two-year contributions (aged 16 and 17). The 14- year old is eligible for the four years' payment (age 14, 15, 16, 17). In five years, it would therefore be a total of $32,000 in the following:
\(7\ year-old (5 \times \$2,000) = \$10,000\\\\9\ year-old (5 \times \$2,000) = \$10,000\\\\14\ year-old (4 \times \$2,000) = \$ 8,000\\\\16\ year-old (2 \times \$2,000) = \$ 4,000\)
Total \(= \$10,000+\$10,000+ \$8,000+\$4,000=\$32,000\)
3. Which of the following is not a characteristic of a good citizen?
obeying laws
being informed about key issues
using natural resources wisely
owning property
Answer:
Owning property
Explanation:
Its the only one that affects solely 1 person rather than benefit the community as a whole
A 6. 75% coupon bond with 13 years to maturity can be called in 2 years. The call premium is one year of coupon payments. It is offered for sale at $929. 75. What is the yield to call of the bond? interest payments are annual and par value is $1,000.
The yield to call of the bond at 6.75% is of 3.26% at call value of $929.
What is yield to call ?Yield to call (YTC) is a term used in finance to describe the return a bondholder will earn if they stay onto the bond until the call date, which happens before it matures. The compound interest rate at which the present value of a bond's future coupon payments and call price equals the bond's current market price may be used to compute this figure.
Callable bonds, a type of financial instrument that enables bond holders to redeem their bonds at a price known as the call price on a date known as the call date, or the bond issuer to repurchase the bonds, are subject to yield to call. By definition, a bond's call date comes before its maturity date in time.
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